The client.log you posted is very confusing.  Here's an excerpt:

[systemimage] Feb 07 16:25:55 2014 (5955) Running group download reactor
[systemimage] Feb 07 16:25:55 2014 (5955) Group download reactor done
[systemimage] Feb 07 16:25:56 2014 (5955) Upgrade path is 170
[systemimage] Feb 07 16:25:56 2014 (5955) Requesting group download:
	http://system-image.ubuntu.com/pool/ubuntu-0e1d92a78814995f84c2647fd3a25bd6c996cb9ad0bdf7bd2bea0a056ebeff9a.delta-ubuntu-f614715d833681978602b6e9d86b282acd008ef98c42be6f510560e91d3be6b9.tar.xz -> /android/cache/recovery/ubuntu-0e1d92a78814995f84c2647fd3a25bd6c996cb9ad0bdf7bd2bea0a056ebeff9a.delta-ubuntu-f614715d833681978602b6e9d86b282acd008ef98c42be6f510560e91d3be6b9.tar.xz
	http://system-image.ubuntu.com/pool/ubuntu-0e1d92a78814995f84c2647fd3a25bd6c996cb9ad0bdf7bd2bea0a056ebeff9a.delta-ubuntu-f614715d833681978602b6e9d86b282acd008ef98c42be6f510560e91d3be6b9.tar.xz.asc -> /android/cache/recovery/ubuntu-0e1d92a78814995f84c2647fd3a25bd6c996cb9ad0bdf7bd2bea0a056ebeff9a.delta-ubuntu-f614715d833681978602b6e9d86b282acd008ef98c42be6f510560e91d3be6b9.tar.xz.asc
	http://system-image.ubuntu.com/trusty-proposed/mako/version-170.tar.xz -> /android/cache/recovery/version-170.tar.xz
	http://system-image.ubuntu.com/trusty-proposed/mako/version-170.tar.xz.asc -> /android/cache/recovery/version-170.tar.xz.asc

[systemimage] Feb 07 16:25:56 2014 (5955) Running group download reactor
[systemimage] Feb 07 16:25:56 2014 (5955) Looking for blacklist: https://system-image.ubuntu.com/gpg/blacklist.tar.xz

What this is telling me is that s-i got to the step where it begins downloading the data files, but then suddenly jumps back to trying to find the blacklist.    I don't see how that is possible.

That may or may not be a clue to the problem, because I also see this:

[systemimage] Feb 07 16:26:37 2014 (5955) Running group download reactor
[systemimage] Feb 07 16:26:39 2014 (5955) Group download reactor done
[systemimage] Feb 07 16:26:39 2014 (5955) No valid image master key found
[systemimage] Feb 07 16:26:39 2014 (5955) uncaught exception in state machine
Traceback (most recent call last):
  File "/usr/lib/python3/dist-packages/systemimage/state.py", line 175, in run_until
    step()
  File "/usr/lib/python3/dist-packages/systemimage/state.py", line 351, in _get_master_key
    'archive-master', self.blacklist)
  File "/usr/lib/python3/dist-packages/systemimage/keyring.py", line 114, in get_keyring
    raise SignatureError
systemimage.gpg.SignatureError
[systemimage] Feb 07 16:26:40 2014 (5955) Group download reactor done
[systemimage] Feb 07 16:26:40 2014 (5955) uncaught exception in state machine
Traceback (most recent call last):
  File "/usr/lib/python3/dist-packages/systemimage/state.py", line 175, in run_until
    step()
  File "/usr/lib/python3/dist-packages/systemimage/state.py", line 513, in _download_files
    with Context(*keyrings, blacklist=self.blacklist) as ctx:
  File "/usr/lib/python3/dist-packages/systemimage/gpg.py", line 74, in __init__
    raise FileNotFoundError(blacklist)
FileNotFoundError: /var/lib/system-image/blacklist.tar.xz
[systemimage] Feb 07 16:36:40 2014 (5955) SystemImage dbus main loop exited

This tells me that the image master key it downloaded wasn't signed by the preloaded archive master key.

Depending on the nature of the dodge, that could happen if you have a dodgy network (i.e. the file wasn't fully downloaded or it got corrupted).   Alan, is there any way to reproduce the network problems so we can figure out what went wrong?  There's really no way to know from the evidence whether it's a problem in u-d-m, s-i, or some place else.

As for the error message behavior, I think that's a system-settings issue.